The Airline Industry Is Expecting Its Best Profits Ever In 2014

The global airline industry should make a all-time high net
profit of $19.7 billion in 2014, according to the latest financial outlook from the
International Air Transport Association (IATA).

That's thanks in large part to a small drop in jet fuel prices,
IATA said in a release accompanying the forecast.

Improved fuel efficiency is making that less expensive jet fuel
go even further. With new planes from Boeing and Airbus, airlines
are starting to see the benefits. IATA predicts airlines will
carry 64% more passengers and 37% more cargo in 2014 than they
did in 2004, but says fuel use will rise by only 17%.

Ancillary revenues — things like bag fees — are bringing in
crucial revenue. "Without ancillaries," the forecast says, "the
industry would be making a loss from its core seat and cargo
products." This chart drives home how those annoying fees are
keeping the industry afloat, as fare revenue flatlines:

IATA

The highest net profit posted by airlines was in 2010, for $19.2
billion. IATA cautions that while 2014 should bring in more
money, the industry's net profit margin dropped from 3.3% in 2010
to 2.4% in 2014.

Global profits for 2013 are predicted to hit $12.9 billion.

IATA represents 240 airlines, which account for 84% of global air
traffic.